The proxy will be created in local host and the socks port mentioned. Just change the proxy settings accordingly in your applications.

For example if you use Firefox , then just change the proxy settings in
Preference >> Advanced >> Network >> Settings.

Just mention 127.0.0.1 which is the localhost IP and the socks port you created.

Configure SSH proxy in firefox

Thats it :) Voila all your web traffic will be routed via the VPS/Server.

Original IP address

Changed IP address

The advantage of SSH proxy over VPN is that only certain applications can be used to divert the traffic and other applications can run on normal internet connection.

P.S : If you use windows and putty, just go to Connection >> SSH >> Tunnels

SSH proxy using PuTTY

Select Dynamic and write any socks port you want to create in source port and click add. Now logon to the server and make changes as mentioned above in Firefox or any application. The traffic will be routed via the server.